Surat Dist Coop Bank in consolidation mode

The Surat District Co-operative Bank Ltd has lined up various measures for further strengthening its position.

"With deposits of over Rs 1,200 crore, the Surat District Co-operative Bank is already in a strong position. The co-operative banking sector is facing a crisis for the last two years or so, but we managed to hold people's faith in us. The bank is slowly but firmly on the path of progress," the bank chairman Dilip Bhakta told Business Standard.

"We have been in the business for the last 96 years. Ours is mainly an agriculture-oriented bank and we have fulfilled our role to the fullest. We have also started giving advances to non-farming sectors since some years. We, however, do not want to sit on our laurels, and are looking for further strengthening our position, so that we can compete with other bigger banks," Bhakta said.

"The first thing we intend to do is to improve efficiency. We have not made any recruitment since 1991, and because of this most of our 501 employees are in the age group of early thirties or mid-forties. With an ageing workforce, we cannot expect much improvement in efficiency. We are in talks with the employees union, so that we can hire some people on contract basis, which could help us in improving efficiency," he said.

The Surat District Co-operative Bank managing director Thakore Parekh informed that the bank is also planning to announce a voluntary retirement scheme (VRS) for its employees.

"We will announce an attractive VRS package for our employees in the near future. We would want 5-10 per cent of the employees to opt for the scheme, which would help us in cutting costs and improve efficiency. We also intend to merge some of our loss-making branches in the coming months," he said.

"This is the age of competition. To compete with private banks, we have to provide good service to customers. For this, we plan facilities such as automated teller machines, tele-banking and other similar facilities to our customers. This will, however, be possible only after our system audit, which is likely to take place in February or March. We believe we will be able to start these services within six or seven months," he said.

In reply to a query, Parekh said, "Compliance to rules and transparency are the foremost requirement in the functioning of any organisation. Problems come up only when one does not comply with the rules. We have been in the business since long, and we have always adhered to the norms - there is no other option. So one thing all banks have to do for avoiding problems is to strictly follow all the rules & regulations set by the Reserve Bank of India."

It is worth mentioning here that the Surat District Co-operative Bank Ltd was originally formed as the Surat District Co-operative (Urban) Union Ltd in 1909. It started banking activities in 1921 and was converted into the Surat District Co-operative Bank in 1923. The bank has become an effective central agency for co-ordination and smooth flow of finance to the co-operative sector in Surat district.

As on March 31, 2004, the bank's total deposits stood at Rs 1,209.80 crore, while the loan advances were Rs 368.69 crore. Of the total advances, advances to the priority sector stood at Rs 334.84 crore, while the advances to the non-farming sector was Rs 30.85 crore.

The bank has a total of 59 branches in the district.